For StyleHaul and Machinima, Traditional Ads Alone Aren't Cutting It

For many YouTube networks, traditional ads alone aren't cutting it. That's why so many are using their stable of stars to reel in branded content deals.

Maybelline has signed such a deal with YouTube network StyleHaul that runs through the end of the year. Eight of StyleHaul's YouTube stars will create videos for the beauty brand and serve as brand spokespeople and create how-to videos using Maybelline products to show cosmetic trends. In addition to running on the creators' YouTube channels, the videos will pop up on Maybelline's content hub City under the "Two Looks" section and could eventually make their way to TV.

"We're not developing TV commercials here. The more authentic content, the better the girls are positioned to act as true brand ambassadors," said Karen Mlynarczyk, VP-media and integrated marketing communication at Maybelline. "It's different than an ad model."

Claudia Sulewski (aka BeyondBeautyStar) is one of the eight StyleHaul creators participating in the program and said that Maybelline suggests video themes "and we go out and make it." StyleHaul's chief revenue officer Alison Kennedy said the creators will make more than 50 videos for Maybelline as part of the deal.

The two StyleHaul videoscurrently displayed on Maybelline's City site have been viewed more than 104,000 times since posting three weeks ago. StyleHaul's network of 4,000 creators count 140 million YouTube subscribers and 53 million monthly unique viewers.

"We as a brand set trends, but these girls are really helping us translate these trends in ways that resonate with our audience," Ms. Mlynarczyk said.

Outsourcing sales
Companies like StyleHaul have blossomed into businesses but remain planted on YouTube, and subject to the 45% cut of ad revenues. One way to diversify is to do branded content deals with advertisers, and keep 100% of the fee. "For larger yearlong programs, the deals are worth upward of $1 million and 80% of that is not standard media [such as pre-roll and banner ads]," said Ms. Kennedy.

"We made the decision early on that we weren't going to sell media," said Ms. Kennedy. Like Machinima, StyleHaul has handed its ad sales duties off to Google's sales teams. "What my sales team is paid on and packaging and putting in front of clients is more focused on content strategy," she said. That may sound high-risk, high-reward, but Ms. Kennedy said the strategy is paying off.